Risk of Business Alliances and Management Integration Failing to Materialise and Synergies Falling Short
First written in FY2017. 4 of 8 entries say "Mitigated", first in FY2019-Q3. Latest entry: FY2025.
The whole theme swung hardest in 2017: 1 of 11 companies on the "Worse" side.
3 other companies' latest entry also says "Mitigated".
- FY2025MitigatedAnnual report
「After approximately 5 years of PMI activities, we will bring them to a substantive and formal close and make a new start.」
Post-integration PMI activities have entered a concluding phase through the introduction of the new code of conduct and reforms to the personnel system, and the risk that the integration will fail to materialise has already been reduced. - FY2020MitigatedAnnual report
「Of this amount, ¥35 billion had been achieved by the end of FY2019, and the remaining ¥25 billion will be achieved by FY2021 through integration of branding initiatives, a review of sales strategies, optimisation of refining costs and improved operating efficiency through the DTK (Dattara Koushiyou) project, while also pursuing the creation of further synergies.」
The management integration itself was completed and ¥35 billion of the ¥60 billion in synergies had been achieved, reducing the risk that the integration would fail to materialise. The risk that the remaining ¥25 billion will fall short continues. - FY2019MitigatedAnnual report
「The Company and Showa Shell Sekiyu K.K. (hereinafter, “Showa Shell”), having obtained approval from the relevant government authorities and other parties and approval at the extraordinary general meetings of shareholders of both companies held on 18 December 2018, carried out a share exchange effective 1 April 2019 under which the Company became the wholly owning parent company and Showa Shell became the wholly owned subsidiary.」
Following approval by the relevant government authorities and other parties and at the extraordinary general meetings of shareholders of both companies, which were prerequisites for the management integration, the share exchange itself was completed, further reducing the risk that the integration would fail to materialise. Risks of synergies falling short and additional costs after the integration remain. - FY2019-Q3MitigatedAnnual report
「By 12 December 2018, all approvals from the relevant government authorities and other bodies had been obtained, and the share exchange agreement was approved at extraordinary shareholders' meetings held separately by the two companies on 18 December 2018.」
Approval by the relevant government authorities and other parties and approval at the extraordinary general meetings of shareholders of both companies, which were prerequisites for the share exchange, were completed, reducing part of the risk that the integration would fail to materialise. The effective date remains 1 April 2019. - FY2019-Q2RestatedAnnual report
「This share exchange is subject to approval by competition authorities in Japan and other countries and is scheduled to be carried out after the two companies enter into a share exchange agreement and subsequently obtain approval of that agreement at extraordinary general meetings of shareholders of each company.」
Although the share exchange agreement had been executed, approval by competition authorities and approval at extraordinary general meetings of shareholders of both companies were still stated as prerequisites. - FY2019-Q1RestatedAnnual report
「This share exchange is subject to approval by competition authorities in Japan and other countries and is scheduled to be carried out after the two companies enter into a share exchange agreement, targeted for October 2018, and subsequently obtain approval of that agreement at extraordinary general meetings of shareholders of each company, targeted for December 2018.」
Although an agreement for the management integration had been executed, approval by competition authorities, execution of the share exchange agreement and approval at extraordinary general meetings of shareholders of both companies were stated as prerequisites. - FY2018RestatedAnnual report
「However, when considering strategic alliances and management integration, the Group may be unable to exercise sufficient control over the management, businesses and assets of its investees. In addition, business alliances and management integration may be affected by circumstances at the other company or the environment surrounding the Group, and the Group may be unable to fully realise the results or synergies initially expected.」
The risks of insufficient control in alliances and integration, circumstances at the other company and synergies falling short continue to be disclosed. - FY2017First statedAnnual report
「However, when considering strategic alliances and management integration, the Group may be unable to exercise sufficient control over the management, businesses and assets of its investees. In addition, business alliances and management integration may be affected by circumstances at the other company or the environment surrounding the Group, and the Group may be unable to fully realise the results or synergies initially expected.」
Insufficient control over alliance partners, the impact of circumstances at the other company on the integration, and shortfalls in expected results and synergies are disclosed as separate risks.